Using the data in the decision tree, calculate the net gain for the marketing campaign - Edexcel - A-Level Business - Question 1 - 2022 - Paper 2

Next, identify the initial costs associated with the marketing campaign. If the campaign cost is £50,000 and the likelihood of not achieving success is 40% (or $0.4), the cost can be calculated as:

$0.4 \times £50,000 = £20,000$

Now, subtract the initial costs from the expected revenue to find the expected gain:

$Expected\ Value - Initial\ Costs = £1,800,000 - £20,000 = £1,780,000$

Lastly, the net gain can be calculated by taking the expected gain value minus the predefined initial value:

$Net\ Gain = Expected\ Gain - Initial\ Value = £1,780,000 - £360,000 = £1,420,000$